Properties surrounding Holyrood Park in Edinburgh are some of the best in Britain to buy-to-let, new analysis has revealed.

Comparison site TotallyMoney looked at more than 580,000 properties across England, Scotland, and Wales to find the postcodes that offer the highest return on buy-to-let investments. Their figures reveal that buy-to-let properties in the EH8 postcode offer some of the best yields in the country - covering areas to the east and west of Holyrood Park.

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With current asking prices in the area averaging at £221,640, compared to average rents of £1,962 a month, the postcode offers a yield of 10.6 per cent. That’s the fourth highest yield in the country, behind two postcodes in Liverpool and one in Middlesbrough, Teesside.

Meanwhile, properties in the EH11 postcode - which covers parts of Dalry, Merchiston, Gorgie and Sighthill in Edinburgh - have the second-best yield in Scotland at 8.0 per cent. Properties in nearby EH12 also offer particularly good returns, with an average yield of 7.9 per cent, covering Corstorphine and the area near Edinburgh Airport.

It’s perhaps no surprise that EH8 in particular offers such good returns on investment, being home to Edinburgh University. In fact, the research shows that university cities in general have some of the highest rental yields, with Liverpool, Manchester, Middlesbrough, and Newcastle upon Tyne also shown to be top performers.

Due to new students arriving in these cities year after year, there's no shortage of tenants for landlords to choose from, making void periods very unlikely.

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However, that doesn’t necessarily translate to the rest of Scotland as a whole. Covering Clova, Memus, Kirriemuir and Forfar in Dundee, DD8 is the worst place in Scotland to buy-to-let - and one of the worst places in Britain. With the average asking price for a house coming to £208,436 and average rents only costing £507, the postcode only offers a yield of 2.9 per cent.

TotallyMoney’s head of brand and content, Joe Gardiner, said: “With students flocking to university cities year after year and looking for a place to live, it’s no surprise the student market is a dependable one for landlords.

“Since so many students are looking for accommodation, landlords may use this as an opportunity to drum up competition between them.

"But, due to the tenant fee ban, changes in mortgage tax relief, and tighter buy-to-let lending criteria, rental profits are now being squeezed more than ever. To maximise their returns, landlords need to be savvier.”

TotallyMoney only ranked postcodes that had more than 30 properties for sale and more than 30 properties to rent, to ensure that the data wasn’t skewed by small data pools.